Our website uses cookies to improve your user experience. If you continue browsing, we assume that you consent to our use of cookies. More information can be found in our Cookies Policy and Privacy Policy.

Newsletter

Latest from Money Marketing

The Competition and Markets Authority has criticised insurers over “stealth price rises” and costly exit fees for loyal customers. The watchdog looked into areas including cash savings, mortgages and home insurance after charity Citizens Advice raised a so-called “super complaint” over how longstanding customers are treated by financial services organisations. The CMA has recognised that […]

Banking lobbyists have warned that UK banks currently face higher tax rates than international counterparts, and that these could hasten banks’ departures if they remain after Brexit. Reuters reports that research commissioned by UK Finance and carried out by consultancy PwC shows London banks face an effective tax rate on profits of 50.6 percent, above […]

Barclays has been fined $15m (£11.9m) by US regulators after attempts were made to unmask a whistleblower by chief executive Jes Staley. In 2016, a Barclays employee sent two letters regarding concerns over the chief executive’s decision to hire a former colleague to work at the bank. The whistleblower posed questions both over the experience […]

19th December 20188:33 am

Comments

There are 18 comments at the moment, we would love to hear your opinion too.

I am finding it difficult to understand why the sudden interest. IFA,s have been battling for years over the unfairness of the FSA, but have basically been told to shut and put up. Has no one of any influence in Government or shadow cabinet over the years not spotted this situation.

Quite simply MPs just don’t know what the FSA is doing to us. It is your duty to bypass AIFA, PFS and go and educate your MP at this or her surgery. Mark & Harriet are a direct result of just this type of hard work. So please get on your phone now and book your surgery appointment. We are in the right and the true will see us through – just go and tell it!

Just a little common sense is all many of us are asking for.
Oh and perhaps if the FSA does push forward withotu an adjusted timescale to reflect what I believe would be a democratic vote from advisers for a more measured timeline with limited grandfathering for heads at the FSA to be lined up for sacking without pension if their stated aims are not achieved, as many of us think the collateral damage will outweigh any benefit due to the timeline being pushed through.

Hitherto the FSA has only pretended to consult the IFA sector and Mark Hoban has attempted to wash his hands by declaring that he cannot interfere in what the FSA does. Clearly therefore there is a serious democratic deficit; FSA apparatchiks can do as they wish and answer to nobody. But now the great wheel of democracy is starting to roll. It took a lot of effort to move it from its rest but now it is moving I think those who so obviously despise it will find it much harder to stop. Lobbying works – write to your MP now and ask him or her to support a full debate.

I see that the above posts are from the usual suspects, and more power to your elbows in working on behalf of ALL IFAs, Even if at times you probably feel that you are not getting the support that you deserve.

For my part I am constantly in touch with my own MP. I sometimes wonder whether he is actually listening as all he ever seems to do is send a copy of my correspondence to others.

Nonetheless I shall continue to press the points and hopefully he will eventually see the point.

I hope that the silent majority are similarly working with their MPs in a similar way!

So far I have had two meeting with my MP at my home/office, one before and after he was elected as well as regular emails between us and he has been very supportive. He hopes to ask a question in the House of Mark Hoban, that he meet his Constituent (me) to discuss The RDR. If I do meet him, amongst other matters, I shall demand an apology from him for his stupid and disparaging comments about advisers.

One thing that surprises me is how few mention the enormous cost of The RDR and its lack of benefit in relation to that cost.

I have seen my MP on a number of occasions and written to her on the subject of the FSA, FSCS etc. She has passed on some of my concerns to Vince Cable as she is not so well versed in these financial issues.
I was bitching about the regulators well before the RDR so you can imagine how angry my messages have become. I am disappointed that so many of my colleagues and probably many of those who have written in these columns haven’t done what I’ve done. If you lie down and die, there’s no one else to blame but yourself, Do something about it.

interesting – the whole RDR issue is of course of interest to me but the essential bit is exams and Grandfathering or not – I can cope with most else but without Grandfathering I and many a thousand like me will be finished.

I will take it upon myself to advise both Harriett and Mark, by sending them a copy by e’mail, of the deliberation given by the renowned Barrister Peter Hamilton –

He feels what the FSA are doing is illegal – the FSMA does not permit the FSA to cancel the authorisation of those already authorised simply because they have decided to change the qualification rules from Jan 2013 – it would appear that if he gets it off of the ground Gareth Fatchett may well be challenging this aspect in the Courts.

An equally well known practitioner in the field at Reynolds Porter Chamberlain has concerns regarding the claim by Peter Hamilton on the grounds that the FSA have the widest powers and can more or less do what they like if it comes to consumer protection – possibly, but of the 10,000 odd IFA’s under threat most could easily demonstrate in the courts that now one is under threat from us – most have a client bank of very happy and satisfied clients !!

Where is the problem –

If anyone has not yet seen the article from Peter Hamilton, e’mail me and I will forward you a copy – it makes for a good read.

No one has asked the clients of IFA’s if this is what they want? My feeling is that the British Public have absolutely no idea whatsoever that this is going on and that their access to IFA’s could be impaired

May I suggest MP’s ask a random selection of constituent – I would be amazed if they don’t think that their MP is from Mars?

Then ask if they now to the nearest million how much is being spent and stand well back when giving the answer

I have a serious concern about the introduction by the Financial Services Authority (FSA) of the Retail Distribution Review (RDR), which will endanger the business of many thousands of independent financial advisors (IFAs) and their staff, and will deprive a large section of the public of access to independent advice.

Before going any further, and to provide the context for my concerns, I should like to refer to some of the sentiments expressed by you and the Government over the past week. We have heard a great deal about “fairness”, “involvement” and “we all in this together”. You said “I’ll get behind the doers and grafters” – as reported in the “Sunday Telegraph” on 24th October. You also said, in your speech to the CBI on Monday 25th October, “We will go with the grain of what is already working. Sadly, I believe that one of your colleagues is not on message.

Mr Cameron, you will be aware that the Treasury Select Committee met last Wednesday, 20th October, to discuss the RDR. I have attached a copy of the transcript and it makes interesting reading. Mark Hoban, Financial Secretary to the Treasury was asked many questions by the Committee and chose to answer only one. He also grossly insulted both IFAs and McDonalds with his comment that IFA qualifications are akin to those of McDonalds. I attach two relevant articles talking about “McDonification” of IFA qualifications. Perhaps I digress, although it worth pointing out that Mr Hoban’s words were offensive to a large number of people.

You may be aware that one of the provisions of RDR is that all IFAs are required to have achieved a new base level qualification by 2012, or lose their businesses/jobs. No IFA can argue against the need for continuous professional development and the acquisition of greater knowledge and skills, but there are significant issues arising from RDR.

You speak of “Fairness”…
Arguably it is unfair that all registered level 3 IFA’s must re-qualify or become disbarred on 1st January 2012. The new examinations apply to all these IFAs no matter what their age and experience. It is expected that about 10,000 IFAs will leave the business prematurely. This is because re-qualifying in their late 50s and into their 60s is not viable. The alternative for these IFAs is to face further study of around 450 hours. The opportunity cost, merely to carry on doing the same type of business upon re-qualification, will not be recouped by those with relatively short working lives ahead of them – this is especially the case for the many sole practitioners and partners of small to medium firms where the average age is in excess of 50.

The sense of unfairness and anger is exacerbated by the following factors:

1. No other profession is treated in such an offhand, harsh and, inconsiderate manner.

2. Jobs will be lost at a sensitive age for thousands of older IFAs with little chance of re-employment. Their staff will also lose their jobs, and many thousands of members of the public will lose access to impartial advice through an IFA.

3. The additional subject requirements for the newly imposed level of qualification are often irrelevant and unnecessary for a specialist practitioner. For example investment advisors are required to know about pensions when it is not their business. Current Continuing Professional Development (CPD) requirements, on the other hand, require practitioners to undertake the acquisition of further knowledge and to keep up to date on relevant subjects only. Rather like specialist doctors or lawyers, specialist IFAs refer to other specialists in areas where they are not competent. The proponents of RDR seem to lack an understanding of the way IFAs work – unless there is a hidden agenda to provide advantage to the discredited banking sector by eliminating sole practitioners and small and medium sized IFA firms. Paul Selly of HBOS said of RDR “Bank-assurers were set to benefit”.

4. In 2010 IFAs attracted just 2% of complaints received by the Financial Ombudsman Service. The banks attracted 61% of complaints. At the same time Standard & Poors reported that for 2010 IFAs held 67% of personal finance business, a level that the banks covet.

5. Many IFAs fail to understand why the Financial Secretary who supports the pro-bank RDR will not allow the survival of some 10,000 IFAs through the universally accepted process of “grand-fathering”.

6. Bank and the regulator’s executives, e.g. Fred Goodwin, do not appear to need to be so qualified.

“I’ll get behind the doers and grafters”…….
The 10,000 IFAs would not have remained business for so many years had they not provided a good service to their clients. Further, IFAs have adapted to enormous changes over the past 25 years with continuous and over-burdensome regulatory revision, and have embraced the IT revolution to a greater extent than many other professionals – all this is certainly demonstrating doing and grafting on the part of IFAs.

“We will go with the grain of what is already working”…….
I think not, unless Mr Hoban can be brought back on message.

Mr Cameron, I ask you and your colleagues to whom this message is addressed, to listen to the concerns of significant numbers of IFAs, and instigate a review of the intention and effect of the Retail Distribution Review.

What a bunch of crybabies. If you redirected your energies into your studies, you’d be well on your way to level 4 already. The enhanced technical knowledge you’d gain would also benefit your clients. But no, you’d much rather bitch and moan about how unfair it all is. Tiresome in the extreme.

Leave a comment

Why register with Money Marketing ?

Providing trusted insight for professional advisers. Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.